One out of every 10 small business owners in Canada knows a peer entrepreneur who lost a business due to legal conflict, yet only 27% have set aside funds to cover any related disputes that may arise in the future.
This is one of the startling revelations revealed in a new whitepaper released by DAS Canada, in conjunction with Ipsos.
Researchers also found that these types of issues are more common than many small business owners believe. 30% of these organizations, consisting of businesses with 99 employees on staff or fewer, have experienced some type of legal conflict in the past three years alone.
The top three sources of such clashes include:
- Collecting outstanding money owed by customers
- Contractual issues with customers
- Contractual issues with suppliers
As a result, many opportunities exist for brokers to educate prospective clients about legal expense insurance, as only 12% retain sufficient coverage, despite 73% agreeing that a dispute would be detrimental to business operations.
“Our research findings suggest that while business owners appreciate the significant impact a legal dispute could have on them, many unfortunately are either not being proactive or feel fully protected,” said Barbara Hynes, CEO of DAS Canada. “That’s where legal expense insurance can help. It fills the gap in their insurance portfolio and gives business owners peace of mind, so they can focus on what matters most – growing their business.”
To learn more, DAS Canada’s whitepaper is available at
www.das.ca/accesstojustice.
